There's no question that our economy has endured some extreme challenges and tough times over the past year or so. Everyone agrees that we're officially in a recession, but the question has now become: how long will it last? Is the end near or do we have a longer road to recovery? Regardless of how you feel about our current economic state or the time till recovery, one thing is certain: a lot of people have taken a good hard look at their finances, cut back spending and paid close attention to their financial situation. Tough times often call for us to "get back to basics." This has made me think about some very important advice that my grandparents often shared with me as a child. They grew up in a very different time, when the Great Depression enveloped the country and so many families had so little. They couldn't afford the luxuries that many of us have today, nor did they want them. They learned to make do with what they had and felt fortunate just to have simple things, like a good meal on the table.
As I think about all of this, I realize a couple of things: 1. It's important to count your blessings and be glad for what you have rather than what you don't have. 2. Listen to the financial advice from a past era, as there are pearls of wisdom that await.
If you're wondering about specifics, here are a few tips that I've learned from my grandparents. I've tried to carry this information with me throughout my life and put it into practice where applicable. It's also useful to share with others so they can apply and benefit from it in their own lives.
1. Frugality is the name of the game. It's sometimes thought that frugal people are simply unfortunate souls without the means to buy more. Some even think that frugality equals cheapness, but this couldn't be further from the truth. In my grandparents' time, being frugal was a great quality. It just means that you get the most out of what you have and buy, and avoid spending money on things you don't really need. This frame of mind helped my grandparents when times were especially tough, but it also benefited them when times improved, as they continued to live by frugal principles and build wealth.
2. Homemade gifts are the best. You don't necessarily have to spend a lot of money on a gift for a friend or family member. Homemade gifts really speak from the heart and mean a lot to the recipient. If you're creative or artistic, a homemade gift will be doubly effective: it will cause less hurt to your checkbook and mean more to the person to whom you've given.
3. Make do with what you have. In today's age when something breaks or becomes worn, people can get frustrated and immediately purchase a new item to replace the old one. In my grandparents' age, they would try to fix or repair the item instead. If your washing machine breaks down, see if you can replace a part before you purchase a new appliance. If there's a tear or h*** in your shirt, a few stitches with a needle and thread could repair it so you can wear it again.
4. Choose the do-it-yourself route. Instead of hiring someone to do very basic repair, maintenance or home improvement, consider taking care of it yourself. Fixing a broken appliance is not always as difficult as it may seem. Need new vinyl flooring in the bathroom? You might be surprised at how easy this can be accomplished with a how-to book and some patience.
5. Avoid debt. My grandparents grew up in a time when things were simpler and you didn't spend more than you made. In today's consumer-spending society, people are encouraged to charge their credit cards and rack up bills that they can't afford to pay. I can't remember a time that my grandparents ever bought something for which they couldn't pay cash. If they didn't have the money, they would save or determine another plan to get something they needed. They never considered going into debt in order to buy something.
6. Have an emergency fund. Unfortunately many people are discovering that rainy days do come and, if they're prepared, rough times may not be as painful. As a child and young adult, my grandparents (and my parents) always encouraged me to save money and set it aside for rainy days or unexpected expenses. They wanted me to enjoy the peace of mind that comes from not living paycheck to paycheck. If you can take even just a small portion of each paycheck and put it directly into a savings account, you'll thank yourself later. Having that cushion can really help you when rainy days come.
7. Look for bargains. When my grandparents needed to purchase something, it was usually a process rather than a quick one-time event. They took time to research, shop around and/or wait for the right price. They didn't just pull out a credit card. They also considered less obvious places to get the things they needed. For example, instead of the big department stores, they might look for something at a garage sale or used clothing/appliance store. Instead of buying that pretty new car that was advertised, they would purchase a used vehicle. Used items are often just as good as new and less expensive.
8. Homemade meals are better than anything. They're often more nutritious too. I can't remember anything as soothing as Grandma's home-cooked meals. My grandparents (and my parents) only went out to eat when it was a special occasion or treat. Our society is focused so much on convenience that a lot of things are overlooked. Going out to eat regularly can get expensive. Consider eating a few more meals at home. You'll save money and you could also have some good bonding time with your spouse/partner, children or family.
Heeding financial advice from a bygone era may offer some insight into your current situation. As basic or as simple as these things might be, they are what made past generations successful. We can learn so much from each other and from listening to our elders. Sometimes we must delay instant gratification and make careful decisions in order to give ourselves more opportunities for the future. That is what my grandparents told me, and that's the advice I still live by.